Binance Unveils New Web3 Wallet at Istanbul Conference Amid Struggles in Spot Trading Business
Summary:
Binance, a leading cryptocurrency exchange, revealed its new Web3 wallet during its conference in Istanbul. Accessible via the Binance mobile app, the wallet utilizes multiparty computation (MPC) to enhance security by segmenting a user's private keys into three parts, two of which are always controlled by the user. This move comes at a time when Binance is reportedly struggling to retain investors in its spot trading business, with its market share falling to 40% in 2023. On the other hand, its new Web3 Wallet is expected to strengthen users' self-management of their digital assets and serve as a bridge to decentralized finance.
At the Binance Blockchain Week gathering in Istanbul, Binance, a cryptocurrency exchange, declared the introduction of its novel Web3 wallet. This new offering would be accessible to all through the Binance mobile application. Binance CEO, Changpeng “CZ” Zhao, clarified during the launch that Web3 wallets offer more than simple storage for digital assets; they play a crucial role in the Web3 structure by enabling individuals to manage their own finances.
In a bid to keep things straightforward, the Web3 wallet will be integrated into the main Binance app predominantly used for cryptocurrency transactions. There will be usage of multiparty computation (MPC) in the wallet, segmenting a user's private keys into three fractions, termed “key shares”. The dispersion of these key share into varied locations offers protection against potential compromises and enhances the system resilience.
Users will control two out of three key shares, enabling personal asset management. CZ stated that Binance's Web3 Wallet eases the path for users to fully govern their assets and serves as an advantageous link towards Decentralised Finance (DeFi) capability. The prime objective remains ensuring a user-friendly and safe environment for users venturing into Web3.
According to Richard Teng, Binance's head of regional markets, the application of MPC technology eliminates the fear of misplacing one's seed phrase. He stated that they desire their users to interact with Web3 securely within protected space, and thus, have combined MPC technology and Binance's established security framework within the Web3 Wallet.
This movement by Binance towards other crypt services is taking place at a time when it seems to be struggling to retain investors in its spot trading business. Blockchain analytics firm 0xScope reports indicate a decline in Binance's spot trading market share to 40% in 2023. The researchers posited that the spot trading volume on Binance witnessed a significant drop last year, likely due to its listing strategy, wherein most popular coins observed depreciation post-listing on Binance.
In contrast, Upbit, a Korean crypto exchange, recorded the most striking rise, with its spot market share surging from 5% to 15.3% during the same timeframe. The slump in exchange volumes also led to a 38% cut in CZ’s net worth, as per the Bloomberg Billionaires Index.
Published At
11/8/2023 7:30:00 AM
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